Justia Arbitration & Mediation Opinion Summaries

Berkelhammer and Ruiz participated in the ADP TotalSource Retirement Savings Plan, an investment portfolio managed by NFP. They filed suit under section 502(a)(2) of the Employment Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. 1132, for their own losses and derivatively on behalf of the Plan. The Plan’s contract with NFP contained an agreement to arbitrate disputes between the two entities. Berkelhammer and Ruiz argued that since they did not personally agree to arbitrate, the arbitration provision did not reach their claims. The district court disagreed, holding that Berkelhammer and Ruiz stand in the Plan’s contractual shoes and must accept the terms of the Plan’s contract.The Third Circuit affirmed. Civil actions under section 502(a)(2) “for breach of fiduciary duty [are] brought in a representative capacity on behalf of the plan as a whole” to “protect contractually defined benefits.” Because the plaintiffs’ claims belong to the Plan, the Plan’s consent to arbitrate controls. The presence or absence of the individual claimants’ consent to arbitration is irrelevant. View "Berkelhammer v. ADP TotalSource Group Inc." on Justia Law

Plaintiff-appellee Baker Hughes Services International, LLC, after winning an Ecuadorian arbitration against the Ecuador-based Pesago Consortium, secured an arbitral award enforceable jointly and severally against the Consortium’s two members: Defendant and third-party Campo Puma Oriente S.A. Plaintiff then brought its award to Oklahoma and sued Defendant to confirm the award in the United States. Plaintiff again prevailed, and the district court entered judgment against Defendant for the award’s amount, prejudgment interest, and attorney’s fees. Defendant challenged the enforcement of the arbitration award, arguing: (1) the U.S. district court lacked subject matter jurisdiction to confirm the award; (2) the district court should not have confirmed the award because the parties never agreed to arbitrate their dispute; and (3) the district court improperly awarded attorney’s fees and incorrectly calculated prejudgment interest. After its review, the Tenth Circuit Court of Appeals affirmed affirm everything except the district court’s award of prejudgment interest, which was vacated and remanded for the district court to reconsider. View "Baker Hughes Services International v. Joshi Technologies International" on Justia Law

Respondent the State of Libya (“Libya”) appealed from a district court judgment granting Petitioner Olin Holdings Limited’s (“Olin”) petition to confirm an arbitration award issued under a bilateral investment treaty between Libya and the Republic of Cyprus and denying Libya’s cross-motion to dismiss the petition on forum non-conveniens grounds. On appeal, Libya’s primary argument is that the district court erred by declining to independently review the arbitrability of Olin’s claims before confirming the final award.   The Second Circuit affirmed. The court held that Libya was not entitled to de novo review of the arbitral tribunal’s decisions because it “clearly and unmistakably” agreed to submit questions of arbitrability to the arbitrators in the first instance. The court further concluded that the district court properly confirmed the final award and rejected Libya’s cross-motion to dismiss the petition. The court explained that regarding the public and private interest factors, the district court held that Libya fell well short of satisfying its heavy burden because it “failed to identify even one” factor that weighed in favor of dismissal. On appeal, Libya makes “no persuasive argument identifying an error in the factual or legal components of the district court’s discretionary decision.” View "Olin Holdings Ltd. v. State of Libya" on Justia Law

Respondent is a former employee who won a judgment in Argentina's National Court of Labor Appeals against Citibank, N.A. Petitioner, the Argentinian branch of Citibank, N.A., filed a demand for arbitration with the American Arbitration Association and brought the proceedings below. The district court compelled arbitration, preliminarily enjoined the employee from enforcing the Argentinian judgment against Petitioner, and held Respondent in contempt of court. It also denied his motion to dismiss.   The Second Circuit reversed and remanded. The court held that the district court lacked subject matter jurisdiction over the Petition. Therefore, the district court was without authority to issue its orders in this case. The court reversed the district court's orders -- including its order to compel arbitration, the preliminary injunction it entered against Respondent, its order finding Respondent in contempt, and its order requiring Respondent to pay the Branch's attorneys' fees and costs. The court concluded that because the Branch has not shown it enjoys independent legal existence and Citibank has not sought to substitute itself or join this action as the real party in interest, there has been no party adverse to Respondent. Without adverse parties, there can be no subject matter jurisdiction under Article III. View "The branch of Citibank, N.A., established in the Republic of Argentina v." on Justia Law

The Court of Chancery granted Plaintiff's motion seeking confirmation of an arbitration award and denied Defendants' cross-motion requesting that the award be vacated, holding that Defendants were not entitled to relief on their claims of error.Plaintiff and Defendants entered into an amended and restated limited liability company agreement (LLC agreement) setting out the parties' rights and obligations. The LLC agreement contained an arbitration provision stating that disputes arising out of the contract would be determined by arbitration. Plaintiff later filed a demand for arbitration, and the arbitral panel issued an award in favor of Plaintiff. The Court of Chancery confirmed the arbitration award, holding that the tribunal did not manifestly disregard the law and that Defendants' arguments regarding mootness were unavailing. View "Huntington Way Associates LLC v. RRI Associates LLC" on Justia Law

Henry participated in an employee stock ownership plan (ESOP) sponsored by his employer. After the ESOP purchased stock at what Henry believed was an inflated price, Henry filed a lawsuit against the plan’s trustee and executives of his employer, alleging that the defendants breached fiduciary duties to the ESOP imposed by the Employment Retirement Income Security Act (ERISA), 29 U.S.C. 1001, and engaged in transactions prohibited by ERISA. The defendants argued that an arbitration provision, added to the ESOP’s plan documents after Henry joined the ESOP, barred Henry from pursuing his claims in federal court. The district court denied their motion to dismiss, reasoning that all parties to an arbitration agreement must manifest assent to the agreement, and Henry did not manifest his assent to the addition of an arbitration provision to the ESOP plan document.The Third Circuit affirmed, first confirming its jurisdiction. The motion to dismiss was effectively a motion to compel arbitration, 9 U.S.C. 16(a) provides appellate jurisdiction to review the denial of that motion. The class action waiver (and, by extension, the arbitration provision as a whole) is not enforceable because it requires him to waive statutory rights and remedies guaranteed by ERISA. View "Henry v. Wilmington Trust NA" on Justia Law

Plaintiff worked for Defendant Skyview Capital, LLC. He sued this entity and others in state court after his termination. Skyview moved to compel arbitration. The trial court granted the motion and stayed the proceedings. Skyview had to pay arbitration fees ahead of the hearing. The fees were due June 4, 2021. On July 7, 2021, Plaintiff’s counsel asked the case manager whether Skyview had paid the deposits. On July 8, 2021, the case manager confirmed by email that Skyview had not paid. Plaintiff filed in the trial court a section 1281.98 Election to Withdraw from Arbitration. The court’s February 2022 order granted Plaintiff’s request to withdraw from arbitration, vacated the order staying proceedings, and awarded Plaintiff reasonable expenses under section 1281.99.
The Second Appellate District affirmed, holding that the order allowing Plaintiff to withdraw from arbitration was proper. The court explained that in enacting sections 1281.97 through 1281.99, the Legislature perceived employers’ and companies’ failure to pay arbitration fees was foiling the efficient resolution of cases. This contravened public policy. The Legislature responded by making nonpayment and untimely payment grounds for proceeding in court and getting sanctions. The point was to take this issue away from arbitrators, who may be financially interested in continuing the arbitration and in pleasing regular clients. Therefore, the trial court was right to decide this matter of statutory law. View "Cvejic v. Skyview Capital" on Justia Law

Ford Motor Company (Ford) appealed from an order denying its motion to compel arbitration of Plaintiffs’ causes of action for breach of warranty, violations of the Song-Beverly Consumer Warranty Act (Civ. Code, Section 1790 et seq.; the Song-Beverly Act) and for fraudulent omission arising from alleged defects in a sports utility vehicle Plaintiffs’ purchased from the dealership, AutoNation Ford Valencia (AutoNation). The central question on appeal is whether Ford as the manufacturer of the vehicle, can enforce an arbitration provision in the sales contract between Plaintiffs and AutoNation to which Ford was not a party under the doctrine of equitable estoppel or as a third-party beneficiary of the contract.   The Eighth Circuit affirmed. The court concluded Ford cannot enforce the arbitration provision in the sales contract because Plaintiffs’ claims against Ford are founded on Ford’s express warranty for the vehicle, not any obligation imposed on Ford by the sales contract, and thus, Plaintiffs’ claims are not inextricably intertwined with any obligations under the sales contract. Nor was the sales contract between Plaintiffs and AutoNation intended to benefit Ford. View "Montemayor v. Ford Motor Co." on Justia Law

The Supreme Court remanded this case to the court of appeal to determine in the first instance whether Sarah Plott Key was entitled to equitable relief from the 100-day deadline prescribed by Cal. Code Civ. P. 1288.2, holding that the section 1288.2 deadline is not jurisdictional and does not otherwise prelude equitable tolling or estoppel.Plaintiff prevailed in an arbitration against Defendant and petitioned to confirm the award. Defendant moved to vacate the award. The trial court vacated the award despite the fact that Defendant filed her motion to vacate outside the 100-day deadline. The court of appeal reversed, concluding that the 100-day deadline was jurisdictional and that the parties could not extend the deadline by agreement. The Supreme Court reversed, holding (1) Plaintiff's requests were filed outside the applicable statutory period; and (2) section 1288.2's deadline for seeking vacatur of an arbitral award is a nonjurisdictional statute of limitations that is subject to equitable tolling and equitable estoppel. View "Law Finance Group, LLC v. Key" on Justia Law

Bielski filed a putative class action, alleging that Coinbase, an online currency platform, failed to replace funds fraudulently taken from its users’ accounts. Coinbase’s User Agreement provides for binding arbitration. The district court denied Coinbase’s motion to compel arbitration. Coinbase then filed an interlocutory appeal under the Federal Arbitration Act, 9 U.S.C. 16(a), and moved the district court to stay its proceedings. The district court and Ninth Circuit denied stay motions.The Supreme Court reversed. A district court must stay its proceedings while an interlocutory appeal on the question of arbitrability is ongoing. Section 16(a) does not say whether district court proceedings must be stayed pending resolution of an interlocutory appeal but an appeal, including an interlocutory appeal, “divests the district court of its control over those aspects of the case involved in the appeal.” Because the question on appeal is whether the case belongs in arbitration or in court, the entire case is essentially “involved in the appeal,” and precedent requires that the court stay its proceedings while the interlocutory appeal on arbitrability is ongoing. If the court could move forward with proceedings while the appeal was ongoing, many of the asserted benefits of arbitration (efficiency, less expense, less intrusive discovery) would be irretrievably lost. Absent a stay, parties could be forced to settle to avoid discovery and trial that they contracted to avoid through arbitration. When Congress wants to authorize an interlocutory appeal, but not to automatically stay district court proceedings pending that appeal, Congress typically says so. View "Coinbase, Inc. v. Bielski" on Justia Law